Daimler sees flat earnings for 2013

Reuters Staff

2 Min Read

The Mercedes star is seen on top of the assembly hall of the new compact Mercedes Benz B-series, which went into production officially in Kecskemet, 100 km south of Budapeston March 29, 2012. REUTERS/Laszlo Balogh

STUTTGART, Germany (Reuters) - German auto maker Daimler forecast earnings this year would be roughly stable after meeting its profit target for 2012 and keeping its dividend flat.

“Earnings are expected to improve in the second half of 2013 compared with the level of the first half,” it said in a statement ahead of its annual press conference on Thursday.

Daimler expects 2013 earnings before interest and taxes (EBIT) from its ongoing business will be in the magnitude of last year’s 8.1 billion euros, which represented an annual drop of 10 percent.

The group had warned in October that it would miss by about 1 billion euros its original 2012 target of stable operating profit of 9 billion euros.

It also postponed to a “later date” its 2013 milestone EBIT margin targets of 8 percent at Daimler Trucks and 10 percent at Mercedes, the latter of which was first put in place back in May 2010.

After admitting in July that its poor sales in the key Chinese market were more than just temporary, Daimler has moved aggressively to bolster its fortunes there and plans to increase annual volumes by half to 300,000 vehicles in 2015.

In December, Daimler brought in a new sales chief for China, appointed a new management board member responsible for its Chinese operations and combined its two competing sales channels for locally built and imported cars.

On Friday, Daimler went a step further and bought a 12 percent of its Chinese joint venture partner BAIC Motor in a deal that values the Beijing-based company at around 5.3 billion euros ahead of its planned stock offering.

Sales in China rebounded last month, growing over 15 percent following a steep drop in December. Nevertheless, Mercedes is outsold there two to one by Audi, while the BMW brand’s volumes there were 50 percent higher last year.